Evening Star Newspaper, March 8, 1933, Page 4

* tion. saying that it may serve member T A4 BANKING SITUATION SOMEWHAT EASED Yesterday’s Partial Opening Helps Understanding of Special Regulations. By the Associated Press. NEW YORK, March 8—With the Federal Reserve sy:tem opening its cof- fers to facilitate financing of necessities and regulations clarified, banks were in many localities prepared today for more general lightening of the burdens of the emergency holiday through cash- | ing pay rcll checks and providing funds nti . in the third day of the ex- 1 financial paralysis, with the special s on of Congress called to deal with the crisis only one | day away, more distinct stirrings of | busine:s in the banks inspired fresh hopes of early lifting of the cloud cf uncertainty. Yesterday's partial re- opening of the banks had been re- | stricted by conflicting interpretations of | regulations. Clearing house associations in various | parts of the country Were preparing issues of scrip, a special “money” which may be paid out, under the authority of Treasury Secretary Woodin, starting Friday, but with the Federal Reserve banks beginning for the first time this week to provide member banks with currency for necessities, the scrip idea began to wane. In both Washingten and New York that the Federal Reserve system provided a readymade means of emergency issuing of currency was said to be gaining ground, while the plan of having region clearing house groups issue scrip or certificates had become involved in difficulties when means were sought to make such a medium nationally negotiable. Plan Is Delayed. Because many banks are not mem- bers of the Federal Reserve system, it sppeared that the scrip plan might de- velop on & local basis in many com- munities, and New York State was ready with its new “Emergency Certifi- cate Corporation,” headed by former Gov. Alfred E. Smith, to deveicp this form of emergency currency. But the New York Clearing House, which had already ordered a substantial volume printed, held its plan in abeyance. Some banking authorities expressed the opinion that the only way that local clearing house issues of scrip could be made readily acceptable in distant cities would be through a Gov- ernment guarantee, and it was felt that a Government guarantee on scrip would be the equivalent to a special issue of Federal currency, for which the Federal Reserve System was already prepared. With the Glass-Steagall measure enacted a year ago, permitting the using of Government bonds as backing for Federal reserve notes. in place of the previous 60 per cent backing of commercial paper, it was explained that the Federal Reserve System could legally issue an almost unlimited amount _of currency. The Federal reserve act permits the system to let its gold reserve run below 40 per cent in emergencies, but deter- mination to bring gold out of hoarding was seen in the regulation partially reopening the Federal Reserve banks, as well as in President Roosevelt's banking holiday proclamation issued early Monday, 50 bankers were con- vinced that maintenance of the gold standard was one of the administra- tion's cardinal objectives. Banks Responsible, ‘The order issued by Treasury Sec- tetary Woodin, providing for resump- tion of reserve bank operations, was rst made public late last night by the jew York Reserve Bank, and provides, among other things, that a reserve bank may not make advances to a member until the member has ex- changed all of its gold and gold certifi- cates for other currency. Further- more, suggestions to tax gold or make it acceptable only at a discount after a certain date have been discussed as measures to bring the metal out of hoarding. The New York Federal Re- serve Bank has for years made it a practice to take names and addresses of persons withdrawing substantial amounts of gold. ‘This order places the responsibility of passing judgment as to which banks are deserving of Federal Reserve ald in meeting pay roll and other essential requirements, squarely upon the shoul- ders of the individual Reserve institu- Thus traordinary na i banks “which, in the judgment of the Federal Reserve Bank, are complying | strictly with the spirit and purpose as well as the letter of the regulations issued by the Secretary of the Treasury pursuant to the President’s proclama- tion.” Yesterday’s experiment in partial re- sumption of banking service was not widely successful. In New York and Chicago great confusion as to what the banks could do developed. but it appeared today that difficulties had now largely been ironed out and the opening of the Reserve banks was ex- pected to help considerably. The Re- serve banks were permitted with limita- tions to resume such accommodations as clearing checks and collection items and making transfers of credit between member banks, so that necessary move- | ment of funds between cities would be ! facilitated. New York Scrip Sought. The New York Clearing House plan of issuing scrip or certificates to meet | the emergency was among the first to be developed in a large city since the bank crisis developed with full force last Saturday, and attracted much in- terest over the country, particularly in | other cities planning similar moves, 5o | the holding of the plan in abeyance | proved somewhat confusing. ‘While the plan has not been formally announced in detail, it was learned that it provided that any member might i deposit a certificate of indebtedness, ac- | companied by suitable collateral. Wlthi the clearing house and receive in turn i bank could pay Each member Would pay a small rate of interest on | the indebtedness to meet expenses of | the plan. It could pay off its ce\'nficm.e| of indebtedness at any time with scrip or cash. As soon as it was announced that the clearing house was planning to issue scrip, New York banks began to recefve inquiries * from correspondent | banks in the interior as to when they could get the New York scrip, which indicated that should it be issued it would have wide circulation. Pay Roll Racket. There was considerable confusion re- garding the meeting of pay rolls. Many banks were besieged with large checks at the opening, each one conspicuously marked “pay roll.” While some checks for moderate sums were met, payments on others were not made and corpora- tions presenting them were adviséd to pay their employes by check instead of cash. “You might call it a pay roll racket,” said one bank official. “We discovered that one of our customers drew pay roll checks on three of our branches. In other words, an attempt was being mace to draw out three times the amount of cash neces- sary to meet the reguler weekly wage disbursement of the comnany. We stopped this at once and are now acting on each individual case. “The thought has occurred to us that it is quite simple for employers to pay their staffs by check. We, of course, | White can't write checks because he 'BANKING IN CHICAGO THE EVENING Depositors Told Remedies . Baffling Situations Created by Bank Holiday Outlined, With Po. Meeting The banking hollday has created a number of situations which have thm-l 25 Per Cent Excise to Force ssible Methods for Them. sands of “average citizens” baffled. These citizens have money, but it is in savings accounts at the various banks, ing what to do. and now these depositors are wonder- Herewith are four of the most common situations which have been out- lined to The Star by the puzzled “victims” and herewith, too, are the answers: Situation No. 1—Mr. White has been saving up to pay his real estate taxes for months and at last he has the money—stowed away in a savings ac. count in a bank. The District gov: ernment has announced it will acce] tax payments by check. DBut, Mr. has a sav.ngs account. Question—What can Mr. White d>? Answer—He should draw a check against his savings account, mark the check with the scrial number of his ac- count and mail it to the Collector of Taxes, D. C. The Collector of Taxes| will not give him a receipted bill, but he will hold Mr. White’s savings ac- count check until the banks aré doing business again and then, after pay- ment actually has been made to the District, he will present Mr. White with his receipt. Situation No. 2—Mr. Black owns a house, but he doesn't live in it. He rents it. The taxes are due and Mr. Black doesn’t have enough momey to pay them. True, a month's rent from the occupant of his property might not cover the tax:s, but would pay a large percentage. The tenant's money is tied up tight in a savings ac- count. Now the District government will grant extensions of tims to house owners for tax payments—provided they live in their property. But, of course, Mr. Black doesn't. Question—What can Mr. Black do? Answer—Nothing. He's out of luck. The law which allows time extensions makes no provision for him. Situation No. 3—Mr. Green owes the United States Government income tax, but Mr. Green's money is tled up in & savings account. Th: Government will accept checks, but Mr. Green can't write one on his savings account. Question—What can Mr. Green do? Answer—He should file his returns— on time. On the returns form he should explain that he is unable to pay the tax beceuse his money i; caught in the ! bank holiday in a savings account. By doing that it is possible he will have to pay a 6 per cent fine, but by not dcing it—that is, by failing to make returns— he will have to pay 25 per cent fine. And, meanwhile, the Internal Revenue Bureau is t,\'y{n;l to determine whether it couldn’t 1ift the prescribed 6 per cent fine under such circumstances. Situation No. 4—Mr. Brown'’s interest on his mortgages falls due. Ever since he made his last payment he has been saving up for the current stipend and he ncw has the amount in his savings account, but can’t get at it because of the holiday. ?uest\:n——wh-t should Mr. Brown o An wer—Sit tight. Then, when the b:nks reopen, craw out all cr as much as he can of the amcunt of his mort- gage obligation and pzy it to the broker or other holder of his ncites. Mean- while, the mortgage brokers are taking a Vsane” view, they say, of the general situation and they are pressing no one for payment they realize can't be made. RITCHIE ASKS AD FOR SMALL BANKS Requests Roosevelt to Con- sider Non-Members of Clearing Houses. An sppeal was made to President Roosevelt today by Gov. Ritchie of Maryland to show consideration to what he described as the thousands of banks throughout the country not members of metropolitan clearing houses, which may not be able to pur- chase clearing house certificates during the bank holiday. ‘The Governor sald that there are nearly 200 of these small banks in Maryland and that something should be done by the Federal Government to relieve these banks from an embarrass- ing situation. He stated that the danger lies in the fact that these smaller banks, even though solvent, will be compelled to close with appalling loss to the depositors and to the States. Asks “a Chance to Live.” “These banks in my State and in other States,” Gov. Ritchie said. “are part of the very life of the people. “Whatever may be the sound bank- ing system of the future, whether it requires the survival of the strong only CHECKS AGCEPTED ~ FOR INCOME TAXES | Drafts on Closed Banks May Be Sent After Effort to Get Cash. By the Associated Press. Checks on temporarily closed banks | are being accepted for income tax pay- | ments, provided a “diligent and con- scientious effort” has been made to fur- nish either cash or a post office money | order. It was explained yesterday at the Internal Revenue Bureau, however, that checks were not being taken on banks that have failed. The position of the | bureau was expressed this way: | "“The taxpayers should file their re- {turns in the usual manner on or be- fore March 15 and, if possible, submit either cash or post office money orders in payment of the tax shown thereon. “In this emergency the bureau feels | that taxpayers should make a diligent and conscientious effort to send with their returns at least the first quarterly miullment, in cash or post office money order. “If it iggnot possible for the taxpay- ers to make payment by means of cash or post office money orders, they should send their checks, even though the banks are temporarily closed, due to the banking holiday. “The collectors will clear the checks if it is possible to do so. or not, I do not think it should be ac- complished at the sacrifice or jeopardy of these smaller banks. ‘The Maryland executive concluded his statement made to the press after his talk with the President, by saying: | “My plea is that the Federal plans take into account the small bank prob- | lem and give these banks & chance o | live now, and if sound national policy contemplates supplementing them 1in the future, that at least this be done in a way which assures no unnecessary loss to the people whose homes and livelihood and savings depend upon‘ them.” | Gov. Ritchie explained at the start | that his information was that it is con- templated to issue clearing house cer- tificates in the various communities, an‘d | that this necessarily includes the reserve | money centers of the country, where the policy of the clearing houses is | largely and often entirely controlled by the liquid metropolitan banks. Long Calls. on President. | out that these banks will in a srotx::u);;selsure decide the class of se- curities against which the certificates may be issued, he said that “thousands | of these small banks are not members of the metropolitan clearing houses, and may not be able to purchase the clear- ing house certificates, either because of | such non-membership or because the Clearing houses specify & more liquid grade of collateral securities than these town and rural banks possess. Some- thing should be done to take care of them.” = Another of President Roosevelt’s = as Senator Huey Long callers today a, who said afterward he e situation, but discussed the banking all he cared to say publicly was that “everybody is going to have plenty and the only solution of this problem is & redistribution of wealth.” REMAINS INACTIVE Illinois Awaits Word From Wash- ington Before Resuming Business. By the Associated Press. CHICAGO, March 8 —General bank- ing in Ilinois remained at & standstill today, awaiting word from ‘Washington as to the anticipated resumption of usiness Friday. b‘Ex'ension of the State banking holi- day by Gov. Henry Horner last night to conform with the regulations speci- fied by the Secretary of the Treasury cleared the atmosphere of confusion. Today the banks devoted specjal fa- cilities to making change, arranging drafts necessary for mnor- | ayment of gnil ‘movement of foodstuffs, and pre- aring for the use of clearing house certificates if serip were authorized. But there was no acceptance of deposits, 1o withdrawals orycashing of checks. Gov. Horner irf’a proclamation asked the citizenry to share with President Roosevelt the responsibility for restor- ing the economic balance and the na- tional faith. James R. Leavell, president of the Continental Illinois National Bank & Trust Co., returned from the conference at Washington with advice to Chicago bankers to remain closed for the time being. “Walt until we work out some uni- form plan for meeting the emergency ! under Treasury rulings” he said. “If we are to have scrig. I prefer that it be of national issue. It will be difficult to operats with a thousand different kinds of paper in circulation.” will cash some of these smaller checks, depending upon the special needs of the individual wanting the money. But it seems to us that, under the present circumstances, the smaller checks Ladies’ Night Planned. MANASSAS, Va., March 8 (Special). —On Friday night the local Kiwanis the ' “However, if the collectors are unable to clear the checks within a reasonable | time, it will be necessary to call upon ; the taxpayers for new remittances.” ALEXANDRIA BANKS LIMIT OPERATIONS Institutions Are Open, But No Money Is Being Released for Pay Rolls or Necessities. By & Staff Correspondent of The St ALEXANDRIA, March 8.—At a meet- ing of bankers of this city last night it was decided to operate Alexandria banks today under all regulations issued yesterday by Secretary of the Treasury Woodin except regulation 10, which per- mits the exercise of usual banking functions to provide for absolute neces- sitles of life, pay rolls and expenditures to maintain employment. According to George E. Warfield, | cashier of the First National Bank, the local banks, in line with the Washing- ton Clearing House, have decided to await more detailed information in re- gard to regulation 10 before operating under it. The local bankers hold that regula- tion 10 is too broad and places too much responsibility on the banks, Mr. War- field said today. In the case of han- dling pay rolls, local bankers would like to know how the money which they would use to cash pay roll checks un- der regulation 10 would be replaced, he said Under regulation 10 the question of deciding whether or not persons ob- taining money from the bank for ne- cessities of life in accordance with pro- visions of the regulation were really obtaining the money for netessities is put up to the bankers to decide, an- other bank official explained. " NOW YOU CAN WEAX ARTIVICIAL TEETH WITHOUT EMBARRASSMENT ANCHOR BAR PLATES 15 Jooth Exteacted by Modern vect ention te Nervous Patients tos ired ¥ o W NoEoRE WehiveDe ANMy Owk Hork DR. LEHMAN 1 Dental Specialist 20 Years 437 7th St. N.W. S Besiner_ FhteePre | dizziness, | feeling, you should inve | Mountain Valley Mineral Water, famous for over 75 years as an | aid in the treatment and pr vention of kidney disorders 1ti cedure with me to prescribe Mountain Valley Mineral Water or Learn how to a protect them. Phoné or write for Information and Booklets today. Mountain Valley Water America’s Foremost Health STAR, WASHINGTON, HEAVY TAX ON GOLD HOARDS DEMANDED Col. Frank Knox Advocates Metal Into Open. CHICAGO, March 8 (#).—Col. Prank Knox, publisher of the Chicago Daily News and former chairman of the Anti- hoarding Commission appointed by for- mer President Hoover in his campaign to drive money into circulation, in a statemient last night urged a 25 per cent excise “to tax gold out into the open.” The tax advocated by Col. Knox would be placed upon all gold “hoarded by private ?enwns or corporations other than banking institutions which are wzmbers of the Federal Reserve sys- Text of Statement, Col. Knox's statement follows: “The President of the United States by proclamation has forbidden the hoarding of money. The Secretary of the Treasury, acting under instructions of the President and in support of the President’s proclamation, has forbidden the withdrawal of any gold or gold cer- tificates. The necessity of conserving the Nation's gold supply and making it in the maximum degree effective as a basis for currency is obvious and pri- mary. This is a measure taken for the E:obectlan of all, since gold coln or gold rs are the basis for the issue of cur- rency. “Under the Federal Reserve act cur- rency must be secured by a minimum of 40 per cent gold reserve. This means that the Federal Reserve system may issue $2.50 for each gold dollar held. “It is transparently clear, then, that every dollar of gold in the country should be available to'the Government and In possession of the Federal Re- serve Banks, and that any person or corporation withdrawing gold for hoarding purposes is thereby reducing the available money for common use by 2'% times the amount of gold so hoarded. The only purpose that a person or corporation hoarding gold can have is to gain a selfish, special advantage at the expense of the whole public. Urges 25 Per Cent Tax. | “Such selfishness and indifference to | the public welfare cannot be tolerated during a national emergency. | “Under the same principle of pro- | tecting the public interest under which | the President declared an embargo on | the payment or shipment of gold, Con- | gress should authorize the President to{ impose an excise tax of not less than 25 per cent on all gold hoarded by private persons or corporations other than banking institutions which are| members of the Federal Reserve system, and this tax should be collected from the last holder of such gold in hiding. | “There is probably not less than $200,000,000 in gold hoarded by private individuals or corporations in the United States, and the sum may be even greater than this. Every dollar of that sum, whatever it is, should be returned to the Federal Reserve prompt- ly by those who now have possession of | it, and i it is not thus returhed prompt- ly, its value to the holder as a means | of profit should be impaired at least to | the extent of the excise tax suggested, which would destroy all reason for hoarding it.” NATIONAL CITY BANK T0 DROP AFFILIATE Securities Company to Be Made Independent of Parent Organization. By the Associated Press. NEW YORK. March 8—The Na- tional City Bank, second largest in the world. and the Natlonal City Co., its securities affiliate, are to be divorced. James H. Perkins, chairman of the bank's board, sald last night officlals of the two concerns would seek to ac- | complish this “as soon as it can be done in an orderly manner without sacrifice of -the assets of the company and of the value which exists in its facilities for the purchase and distribu- tion of investment securities of the highest grade.” Charles E. Mitchel, former chairman of the two concerns, and Hugh B. Baker, president of the National City Co., resigned recently following dis- closures before the Senate Banking |g Committee. Perkins returned yesterday from a visit to Washington, during which he conferred briefly with President Roose- velt. Fire Advisers to Meet. SEAT PLEASANT, Md. March 8 (Special) —The advisory board of the Prince Georges County Volunteer Pire- men’s Association will meet tonight at 8 o'clock in the Tuxedo-Cheverly Fire- men’s Hall. RENOVIZE* Your Heating Plant If you have been Wfllfldeflni the advantages of heat, bu have been deterred by the cost of installation, take advantage of the nt low prices on Rich- mond HEATOMAT Gas-Fired Bollers. See them on display in our sales room. During This Campaisn. We Offer 3 “gchafer Quality” Materials E. G. Schafer Co. 4100 Georgia Ave. Telephone ADams 0145 * “Renobize Washington” Campaion ADVERTISENENTS W gl RECEIVED HERE Stewart’s Pharmacy—S8th & Eye S.E. Is an Authorized Star Branch Office !I of the authorized copy at any one of them, the first available issue. | TERMINAL SE The Star Classified Section for all types of wants—and take advantage of the facilities D. C., WEDNESDAY, EXTENDED HOLIDAY EXPECTED FRIDAY Roosevelt May Continue Limited Banking Pend- ing Legislation. ___(Continued From First Page) _ under which currency would be used, but made it clear that a formal plan for scrip or other medium of exchange| issue was being abandoned. ‘The Secretary appeared h‘ahly op- timistic of the outlook “We can €ee the light here,” he said, with a smile, on addressing newspaper men who surrounded him at his office in the Treasury. “This thing isn't going to pieces.” It I})ml:!d that announcement as to | what form of money was to be adopted | and its backing must be made by mid- | night tomorrow, because a conditional regulation issued earlier in the week by Woodin permits issuance of scrip Friday | moning. The Secretary had lp{nrently fore- seen the possibilities of the present plan, for in issuing the clearing house certificate issuance permission he made it conditional that it might be revoked. Could Be Expanded. Federal reserve currency could be expanded $2,000,000,000. if the banks took full advantage of the Glass- Steagall law and have sufficient Gov- ernment bonds to put up as security | above the 40 per cent gold require- ment. The law permits Federal reserve banks to put up Government securities to the face value of 60 per cent cf the currency they issue, and requires that the other 40 per cent collateral be gold. The old law required a 40 per cent gold backing and a 60 per cent back- ing of eligible (commercial) paper. On Marcp 8, Federal reserve banks had issued $3,865,000,000. of Federal Teserve notes. Backing this they had $2,180,000,000 of gold, $1,032,000,000 of commercial g;x':ed: and $662,000,000 of Government Reports to the Treasury show that the banks ectually hold about $220- 000,000 more gold than they have up as security for currency or a total of approximately $2,400,000.000 Using the entire $2,400,000,000 gold as 40 per cent security, the banks may, | if they hold sufficient Government | bonds to make up the remainder of | the collateral, issue roughly a total of | approximately* $6,000,000,000 in cur- rency. May Reach Maximum. Since the banks in the last 18 months have been investing their funds | chiefly in Government securities, and | there are something like $8,000,000,000 of long-term bonds outstanding, Treas- ury officials believe they would have no difficulty whatever in expanding the circulation to the full maximum per- mitted under the law. At the same time national banks eould expand their currency by about $840.000,000 under the provisions of the Boreh-Glass amendment attached to the home loan bank law. The banks under this amendment are | permitted to issue currency up to a maximum equal to their capital stock, and back it with Government securities bearing not more than 3% per cent in- terest. Though there were $3,500,000,000 such securities outstanding, the capital stock of the national banks at the time the amendment was adopted amounted to_$1,600,000,000. The banks at that time had out-| standing $666,000,000 of currency and | since that time they have taken advan- | tage of the amendment to the extent of $156,000,000. The figures were given in round Rumbers and officials said that there still remained an expansion | of approximately $839.000.000 of which | the national banks could avail them- selves. Combining the possibilities of the | two acts Federal Reserve and national | banks of the Nation could expand near- ly $3.000,000.000 in currency as rapldly as the details could be rushed through the Treasury. | Meanwhile, an invitation to trade! SALE OF CHAIRS e and 1 5 ing th of March. National 0992 'OUR PLUMBER'| | Bituminous-Smokeless A full 2,240 lbs. in egg size. You'll find our delivery service unusually prompt and clean. lé‘ré li FUEL CO- 3rd & K Sts. N.W. NA. 0990 Branch Offices—leaving assured of its insertion in You can readily locate the authorized Star Branch Office in your neighborhood by the above sign. No fees in connection with Branch Office serv- MARCH 8, 1933. frozen gold for currency to finance es- sential everyday affairs, such as meeting of.payrolls and food purchases, Wwas put before the vast Federal Reserve System. The invitation—almost s direction— was in the form of new regulations sent to Federal¢Reseérve banks by Sec- retary Woodin of the Treasury. In a word, he told Reserve banks they could give currency to members for “abso- lutely ne ” purpases in exchange for gold or currency. Since Pry nt Roosevelt's drastic proclamation Sunday night the gold the Reserve member banks held been so locked up as to be virtually useless for currency purposes. Under the new regulations, however, it may xmmnc 210 to the l:esl:rve banks for Yy carry cut the limited oper- atlons alread; Woadin: ly approved by There were indications that this new gold-currency exchange order was to be coupled with an effort to obtain ex- pansion under the Glass-Steagall act, which became law a year ago, Under this act, Reserve banks were author- ized to issue currency based on 40 per cent gold and 60 per cent Government obligations. The old law required the 60 per cent to be supplied by eligible commercial paper, and it was argued that currency expansion under that provision would tend to restrict credit by tying up more of that class of PAPer. | yeeting this evening. Pay rolls in| _Until President Roosevelt declared his gold embargo, however, few banks had taken advantage of the opportunity to use excess gold for additional cur- rency. Administration officials a) - ently hoped that with the pemm.u:n to transfer free gold to Federal Re- serve banks and get currency in its place, & wider utilization of this power would result. This idea was being turned to, at least temporarily, because of difficuities encountered in attempts to form a na- tional plan for the issuance of clea house certificates—scrip. Whether that plan would be definitely abandoned re- mained to be determined. It wes known that Senator Glass of Virginia, ardent opponent of anything he considers “inflation,” had urged a greater use of the permission contained in the Glass-Steagall act in place of emergency steps. WOODIN FIXES RULES FOR NEW CURRENCY Limitations Placed on Rediscount- ing by Federal Reserve Banks. By the Associated Press. NEW YORK, March 8.—Strict limita- | tions were laid down by Secretary Woodin in permitting Federal Reserve | banks to rediscount for member banks and supply them with currency for vital needs. Before a member bank obtains this privilege it must: Disclose the amount of coin and | added: currency it has on hand. Z GLEARING HOUSE T0 MEET TONIGHT D. C. Banks Limit Their Business to Only Five Items. (Continued From Pirst Page.) the heavy pay roll withdrawals, would take vast sums of money out of the banks while not a cent can be paid in. Buch & move is considered unfair to the other depositors. At the same time, hope was expressed that in some way pay rolls may soon be met in order that the local banks may help normal trade | in every way possible. Meet Again Tonight. The Clearing House Association is| scheduled to hold another protracted | other parts of the country are being held up in the same manner, so that some practical steps in meeting the situation must be worked out in a very short time. In s statement given out late last night by the Washington Clearing House Association, signed by Chairman H. H. McKee, it was recommended w‘ the local banks that charge-backs be | ring | made in accordance with the terms of the Treasury regulation which says that “Where settlement for checks charged by drawee institutions to the drawers’ accounts on its books on or before March 4, 1933, is incomplete, settle- ment may completed where such | settlement d not involve the pay-| ment of money or currency.” The reg- | ulation was put into effect today. | i Local banks also are delivering to| persons entitled thereto properly iden- | tified documents and securities held in | safe-keeping, this action being based on another recommendation from the | clearing house, after yesterday's Treas- | ury regulation on this point. Trust Departments Busy. Trust departments in the banks here are today operating as though the bank holiday proclaimed by President Roose- | velt did not exist; except that theyl cannot pay out or permit the with- drawal of any coin or currency nor withdraw any trust fiduciary funds on | | deposit with any other department of | the bank. The clearing house statement sald that definite action had been delayed on Secretary Woodin's regulation per- taining to the exercising of the usual banking functions to provide for food, | medicine, relief of distress, pay rolls and expenditures to maintain employ- ment. This regulation is permissible only, the recommendation said, and | “Until further study can be| given to its terms by the clearing house, | Explain the need for additional |it is recommended that banks refrain | coin and currency. 3. Deliver all its gold and gold cer- from permitting withdrawal of deposits, | in accordance with the President’s bank tificates to the Federal Reserve bank in | holiday proclamation.” exchange for qther currency. The only banks to receive such l(‘-E the clearing house is to commodations are those which, in the judgment of the Federal Reserve bank, are complying with the spirit as well as the letter of the Treasury regulations. . WORK WITHOUT PAY Employes of Glass Plant Agree to ‘Wait on Salaries. ‘TIFFIN, Ohio, March 8 (£).—They'll | get no pay for a while, but employes | of the United States Glass Co. at Tiffin. Ohic, said they go to work today anywey. The company had closed the local plant for the duration of the bank holiday, but when union workers agreed | to wait for thelr pay until bank re- strictions are removed, ordered activi- | ties resumed. The Hecht Co. | ing functions to such extent as its ‘The full text of this regulation, which give further| attention, follows: | “Any national or State banking in- | stitution may exercise its usual bank- | situation shall permit and as shall be absolutely necessary to meet the needs of its community for food, medicine, other necessities of life, for the relief of distress, for the yment of usual salaries and wages, for necessary cur- rent expenditures for the purpose of maintaining employment, and for other similar essential purposes: Provided, however, that (1) every precaution shall be taken to prevent hoarding or the unnecessary withdrawal of currency: (2) no State banking institution shall engage in any transaction under this| regulation which is in violation of State | or Federal law or of any regulation is- | sued thereunder; (3) no national bank- | ing association shall engage in any| transaction under this section which is will cash your P in violation of any Federal law or of any order or reguiation issued by the controller of the currency; ‘and (4) no goid or gold certificates shall be paid out. Each banking its directors and officers strictly accountable for fait] pliance with the spirit and well as the letter of this Deposit Box Entries. In addition to these enlarged services, offered by the local banks today, they are also permitting entry to safe de- posit boxes, making change for cus- tomers, accepting payments on obliga- tions due from customers, and cashing checks drawn on the Treasurer of the United States. The latter regulations were adopted on recommendation of the Clearing House Assoclation when the local banks were reopened Tuesday morning after the bank holiday proclaimed by Presi- dent Roosevelt had been partially lifted by special modifications issued by the Treasury. ‘The question of scrip is one of the biggest problems in the minds of Dis- trict of Columbia bankers, as well as among their thousands and thousands of customers. All that the Clearing House officials have yet said is that it is being studied by the special committee from every possible angle. To the layman the issuance of scrip, or some form of Clearing House certifi- cates, appears to be a comparatively simple matter. Yet it is most difficult and to be avoided if possible. In the first place it cannot be printed hurriedly. It has to be engraved the same as any other paper money on the very finest of paper and in a manner which cannot be counterfeited. It cannot be printed by the Bureau of Engraving and Printing, but must be produced by some firm which has no Government connections. That firm has to be bonded. Ancther vital point is the fact that it has to be backed up by the soundest of assets. It is based on the assets of the banks which are to use it so that a special committee must go over the as- sets of each institution most closely. The Clearing House, in assuming re- sponsibility for its soundness, has many tasks to perform before the substitute currency is actually put into service. The problems in issuing scrip involve 50 many different points of views that officials of the local Clearing House have refused to act hastily. Once scrip is put in circulation, bank- ers say, it is easy to handle both in and out of the banks. as tion.” “...Youdon't tell me?” See Thursday’s Evening Papers R e T AT D ! . Government Checks regardless of whether you make a pur- chase or not. Cashier’s Desk, Main Floor. ES, there is a store in Washington where you don’t have to lay out all your ready cash to buy the things you want! $5 delivers any BIG little RADIOS! Our Special Miniature $11.%5 Completes (Main Floor, The Hecht Co.) For either alternating or direct current. Full- size performance. With tubes. New : Pco Little Set 51 8.7 Complets (Main Floor, Radio Dept.) With extended dial for short wave police calls. With Philco 1933 type tubes. with latest tubes. Mahogany (Main Floor, using 5-tube, amplified type. Dyna- mic speaker. (Main Floor, Radio Dept.) RCA Victor Portable Set For direct or alterna- ting current. Complete $]_9.95 Complete Hecht Co.) type RCA The 1933 Majestic Little Radio miniature latest $19.% Complete Our Charge Account Facilities are Functioning as Usual During this Emergency! If you have no account, we will be glad to open one for you. THE HEC T CO- All Other Calls, NA. 5100 Phone Orders or Adjustments, DI. 9400 would be accepted by grocers, butchers, | Club will hold its annual Ladies’ night ., and that the use of immediate in the basement of Grace M. E. Church. cdsh is not altogether necessary in Dr. Eli Swavely is in charge of the most cases.” program. Water From HOT SPRING!LARK. 1405 K N.W, Met. 1062 ice; only regular rates are charged. 4 \